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Half of C-Suite execs are considering budget slashes for Q2 2025, driven by tariff fears, slowing demand, and inflation, according to a Gartner poll. This caution coincides with marketing departments, already facing flat budgets, increasingly turning to AI for efficiency.
Feeling the pinch: Marketing allocations have remained static at 7.7% of company revenue for two years straight, leaving nearly 60% of marketing leaders feeling underfunded for their 2025 plans. Ewan McIntyre of Gartner noted, "Given the looming macroeconomic uncertainties, CMOs are now confronting the prospect of in-year budget cuts."
Robo-productivity drive: To cope, marketing heads are leveraging AI, with nearly half citing improved time savings and 40% noting better cost efficiency from GenAI investments. This tech-driven push for productivity might lead to cuts elsewhere, as nearly 40% of marketing chiefs consider reducing agency support and another nearly 40% eye labor reductions.
The bottom line: As companies navigate ongoing economic uncertainty, expect a continued push for operational flexibility and AI-driven efficiencies, potentially reshaping team structures and external partnerships across various functions. Meanwhile, overall IT spending is projected for a major increase in 2025, even as specific departmental budgets tighten. Separately, some analysts see companies shifting their AI goals next year towards more immediate bottom-line gains, and Gartner offers a deeper dive into adapting to U.S. policy shifts impacting businesses.
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